Eye on Lithium: China stuns EV market with huge US$72.3 billion tax break package on new purchases

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• New brine tech cuts out waste, improves efficient extraction
• China provides four-year extension to EV tax breaks
• Lithium spot prices rise again

All your lithium news, Thursday June 22.

In a boon for EV (electric vehicles) production, the world’s largest market, China, has unveiled a US$72.3 billion package of tax breaks over four years for EVs and other green cars to boost auto sales growth.

“New energy vehicles purchased in 2024 and 2025 will be exempted from purchase tax amounting to as much as 30,000 yuan (US$4,170) per vehicle,” China’s Ministry of Finance said in a statement.

“The exemption will be halved and capped at 15,000 yuan ($US2,085) for purchases made in 2026 and 2027.”

While expected, the tax breaks far exceeded market expectations, the China Passenger Car Association stated.

The trickle-down effect should see demand for battery-grade materials – including lithium – remain buoyant across the period as long as EV sales keep growing.

Spot lithium carbonate prices in China have almost doubled in the past two months to US$44,146.27/t last week, according Fastmarkets, and a further pick-up in electric vehicle sales in the world’s biggest market should see these prices remain buoyant.

Brine lovers rejoice!

Meanwhile, a startup funded by Monash University is building an extraction system to filter lithium from brine using a membrane-based process, allowing it to be extracted from salt lakes, mine tailings and other brine solutions using small amounts of solar-generated electricity AND without added chemicals or water.

With its cutting-edge electro-filtration membrane technology, ElectraLith believes it could usher in a new era of lithium extraction, propelling the battery market into a cleaner, cheaper and faster future.

It’s headed up by Professor Huanting Wang, Director of the ARC Research Hub for Energy-efficient Separation at Monash University’s Department of Chemical and Biological Engineering.

His pioneering work in nanostructure membranes has paved the way for ElectraLith’s game-changing technology.

“Current lithium extraction methods involve either roasting hard rock at high temperature and dissolving it with hot sulfuric acid, or evaporating brines in a solar pond, both of which use chemicals to precipitate lithium out.

“It’s time consuming, disruptive, expensive and wasteful. My research in nanostructure membranes is all about efficiency and ingenuity to make the most of this limited mineral resource.”

“Even though seawater is a brine, the concentration of lithium is too low for cost-effective extraction, but we are already thinking about designing the next generation of membranes to improve lithium extraction, so maybe in the future we can extract lithium from new sources,” Dr Wang said.

Here’s how Aussie lithium stocks are tracking:

45 lithium stocks saw green today, while 50 stayed flat and 54 saw red.

WHO’S GOT NEWS OUT?

EUROPEAN LITHIUM (ASX:EUR)

EUR has completed its acquisition of three highly prospective lithium projects near its flagship Wolfsberg project to expand its footprint in Austria as it strives to become Europe’s first supplier of battery-grade lithium hydroxide.

The Bretstein-Lachtal, Klementkogel and Wildbachgraben projects were acquired for $250,000 in cash, 2 million shares and 2 million options and contain samples of up to 3.98% Li2O from spodumene-bearing pegmatites.

Bretstein-Lachtal consists of 191 licences covering 89.2km2 – making it the largest of the new projects – about 80km northwest of Wolfsberg.

Wildbachgraben contains 32 licences immediately east of the proposed Wolfdberg mine, while Kelmenkogel has 22 licences to the north.

“We are pleased to complete the acquisition and add this highly prospective lithium ground to our portfolio of European projects,” EUR chair Tony Sage said.

“The company intends to commence initial work focusing primarily on the Bretstein-Lachtal project area.”

FUTURE BATTERY MINERALS (ASX:FBM)

The last of the 23-hole Phase 2 drilling assays from its Kangaroo Hills lithium project have returned some further high-grade hits containing up to 1.36% Li2O.

New intercepts show 23m @ 1.03% Li2O from 53m, 15m @ 1.03% Li2O from 39m and 13m @ 1.23% Li2O from 41m at the Big Red prospect.

Assays also uncovered a new pegmatite at the Rocky prospect remaining open to the south and east from hole KHRC037 which showed 5m @ 1.12% Li2O from 104m.

FBM is fully-funded for Phase 3 drilling which is set to commence within a week, infilling Big Red and testing regional targets Rocky, Eastern Grey, Wallaroo and Pademelon.

A drilling program will also expand between 7000m-10,000m of RC and diamond drilling to test the northern extension target at Big Red and will commence once permits are received.

FBM technical director Robin Cox said the company is excited to get back on the ground drilling at the KHLP after receiving such promising assay results.

“The assay results have clearly confirmed the exciting potential of the Big Red prospect, as additional shallow high-grade results have been received from the March 2023 discovered pegmatite,” Cox said.

“Significantly, the results from KHRC037 have also confirmed the potential of the Rocky Prospect.

“By the end of June, the Phase 3 drilling programme will have commenced, aiming to test the scale of Big Red and the regional prospects identified through the ongoing target generation representing a significant and expansive next phase at the KHLP.”

WILDCAT RESOURCES (ASX:WC8)

WC8 has bought out the remaining 33% interest at its Pilgangoora North lithium project in the Pilbara from Mining Equities for $200,000 worth of WC8 shares.

The tenements are just south of WC8’s Tabba Tabba lithium-tantalum project, which it has entered into an agreement to acquire in May, with the news putting a rocket underneath its share price that doesn’t seem to have abated.

Tabba Tabba is adjacent to tenements owned by FMG, which recently drilled out a lithium orebody and was briefly explored for tantalum by Pilbara Minerals in 2015.

WC8 is about to embark on a significant drilling program targeting LCT mineralisation at Tabba Tabba, so keep an eye out for more news.

ASKARI METALS (ASX:AS2)

AS1 has a wide portfolio of lithium, REE and gold projects in Australia on top of its flagship Uis lithium project in Namibia.

It’s busy exploring at all of them, however, today’s big news comes out of its Hillside lithium prospects in the Tambourah district in WA, where it completed soil sampling and recon campaigns that have identified several potentially lithium-bearing pegmatites.

These pegmatites were discovered along strike of the Trigg and East Curlew project areas being explored by neighbour Eastern Resources (ASX:EFE). Samples are being sent to the lab for analysis to determine the next steps at Hillside.

Askari said the exploration potential of the Hillside Lithium Project is significant.

“The area is under-explored for lithium and never drill tested, providing a significant opportunity to make a greenfield lithium discovery,” the company stated.

“The greater Tambourah area is currently a hive of activity for lithium-caesium-tantalum pegmatite exploration, with multiple companies operating nearby presenting evidence of lithium mineralisation within the large pegmatite swarms at Tambourah.”

The company said it had now completed the sampling and recon campaigns across all its Australian gold, lithium and REE projects.

BATTERY AGE MINERALS (ASX:BM8)

BM8 has signed a key early exploration agreement with Whitesand First Nation and commenced a maiden drill program at its Falcon Lake lithium project in Ontario, Canada.

The news comes off the back of expanding its landholding at its nearby Jesse Lake project, staking 54 single-cell mining claims, which it reckons holds potential for lithium-caesium-tantalum pegmatites.

BM8 CEO Gerard O’Donovan said the company welcomed the finalisation of its agreement with Whitesand and the formalisation of a strong partnership.

“The company is extremely pleased that it took the time to cement a strong partnership with our First Nations partners, putting in place a strong and sustainable framework for advancing the project in close collaboration with Whitesand First Nation,” O’Donovan said.

“We now look forward to turning our full focus to drilling at Falcon Lake and rapidly unlocking the potential of this project for all of our key stakeholders.”

At Stockhead, we tell it like it is. While Future Battery Minerals and European Lithium are Stockhead advertisers, they did not sponsor this article.

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